With the advance of AI innovation continuing to accelerate, the payments industry is today exploring a wider range of AI use cases than ever before. AI applications are increasingly being deployed to improve the scalability of payment processing, spanning areas such as financial crime screening, client risk assessments, multi-jurisdiction data-sharing, and the automated analysis of alerts and regulatory reporting.
At Banking Circle, we are deploying AI as a key enabler of our vision to build a global payments network that is simple, fast, and low-cost, with world-class levels of security and compliance. Alongside leveraging our vast internal data to train and refine our algorithms, the application of AI to remove key bottlenecks in scaling our operations represents a core component of our strategy.
Perhaps the primary focus in scaling Banking Circle’s payments flow is the need to embed financial crime requirements into the payment journey. The ever-evolving nature of financial crime and sanctions means that friction may enter the payment process through manual intervention to review payments. This, often necessary friction, directly impacts the cost and speed of payment processing. Each time a payment is stopped due to potential sanctions violations or investigated due to money laundering or fraud concerns, a cost is incurre,d potentially leading to a delay. At Banking Circle, our ambition has always been to bring efficiency and speed to payments without compromising on security.
In-house proprietary AI systems can be key to resolving financial crime investigations more quickly, efficiently, and accurately, and have been crucial for scaling payment flows and driving broader business growth.
Our proprietary AI-driven AML intelligence platform spans several core areas, including sanctions screening, transaction monitoring and client risk scoring.
Banking Circle’s sanction screening application detects potential sanctions and risk appetite violations. Closely integrated with Banking Circle’s case management system, the tool also ensures that screening is conducted in line with our own internal standards.
For transaction monitoring, we have developed our own system to enhance the detection of potential money laundering. The system leverages the vast amounts of relevant data in Banking Circle’s ecosystem to identify suspicious patterns, enhance detection, and reduce false positives, while also enabling us to learn from past transactions, adapt to new patterns, and more effectively highlight suspicious activities.
The impact of both solutions has been significant, driving a tenfold improvement in Banking Circle’s hit rate over the past five years and decreasing the level of unnecessary focus on transactions aligned with the agreed nature and purpose of flows. Meanwhile, the flow of payments has increased tenfold while false positive rates have fallen by the same proportion. In addition to our screening systems, we utilise a client risk scoring model that is based on account data, payment data, as well as internal and external AML case data to continuously score our clients. Additionally, this gives a concrete measure of portfolio risk over time and a way to forecast and act proactively on both overall and tail risk.
Looking ahead, we see a growing number of AI use cases across our operations. These include using AI to deliver insights for end-to-end decision support along the client journey, such as client onboarding and developing tailored pricing models for clients based on key characteristics.. We also view automation as an area ripe for AI-driven innovation, including the use of Generative AI models to facilitate the expedited analysis of alerts and operational interactions, thereby reducing manual work and improving rapid response times. Whilst AI has often been seen as a means of reducing FTE (full-time equivalent), Banking Circle remains focused on developing systems to relieve its highly skilled teams of manual, inefficient tasks, allowing them to prioritise instead analytics and quicker, improved decision-making.
As AI continues to evolve at pace, its potential to transform the payments landscape is only just beginning to emerge. At Banking Circle, we are committed to staying at the forefront of this evolution, harnessing the power of AI to unlock new levels of scalability, resilience, and intelligence across our network.
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